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New Hampshire Hurts Health and Budget at the Same Time

Revenues drop after 10-cent cut in tobacco tax

Posted by: Editor | Aug 4, 2011

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The upside-down logic that prompted New Hampshire lawmakers to cut the state's cigarette tax by 10 cents already has backfired:  State revenues dropped by $6.6 million in July compared with July 2010 due in part to the falloff in revenues from the misguided cigarette tax cut.

House Speaker William O'Brien had insisted on the tax cut, arguing — we're not kidding — that reducing taxes on a deadly product would boost the New Hampshire economy by attracting smokers from neighboring states. Instead, cigarette makers hiked prices, leaving the overall price of a pack unchanged. 

Now the same fiscal crisis that already has forced the Granite State to cut spending on hospitals, higher education and other vital services looks to be getting worse. That's what happens when politicians let public health and prudent tax policies go up in smoke.

For more on New Hampshire's unhealthy experiment, read our earlier post.

 

 

 

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